Financial Scam Rocks The Moi Teaching And Referral Hospital

By The Weekly Vision Team

Barely a week after the High Court in Nakuru temporarily suspended the appointment of Dr. Philip Kiptanui Kirwa as the Chief Executive Officer (CEO) of Moi Teaching and Referral Hospital (MTRH), details have emerged of how the hospital’s top management has been involved in a series of financial mismanagements. The suspention was as a result of a petition filed by Dr. Magare Gikenyi.

It has been reported that the hospital is facing a significant financial challenge as it is owed hundreds of millions of shillings by its clients. As of June 2023, the hospital’s outstanding debt stood at Ksh. 1,159,215,568, with some of the debts dating back to as early as 2001.  Recent investigations have shown that the hospital management holds several land title deeds and motor vehicle log books as collateral from debtors. Interestingly, there are no sworn affidavits or agreements between the hospital and the patients rendering the management’s continuous retention of these documents as a debt security measure ineffective.

Additionally, there is no indication of any ongoing legal pursuit to recover these debts. Under these circumstances, it appears impossible to recover the money. It has also been discovered that the hospital has been making huge losses, and this has been attributed to mismanagement. The hospital reported a net loss of Ksh. 619,922,162, resulting in an accumulated loss of Ksh. 394,300,462 as of June 30, 2023. During the year ended June 30, 2022, the hospital also reported a net loss of Ksh. 486,474,929, translating into operating losses for two consecutive years.

Moreover, the management is under scrutiny for misusing the procurement process due to the discovery of unauthorized purchases of oxygen. Investigations uncovered that a local contractor was paid Ksh. 14,979,798 for procuring oxygen att a time when the hospital maintains an operational oxygen processing plant. Although the hospital management has provided an explanation stating that they enlisted the services of a local contractor during the plant’s maintenance period, there is no documented evidence available to support their statement. 

The management also paid travel and accommodation allowances amounting to Ksh. 55,446,281 included in the travel and accommodation amount of Ksh. 5,446,281 is an amount of Kshs. 1,285,100 that was imprest issued to a member of staff for hiring conference facilities, accommodation, and meals for hospital staff and board members during a board retreat.

Investigations and review of the imprest surrender documents revealed that an amount of Ksh. 1, 220, 1.00 was paid to a hotel and Ksh. 65,000 was paid to another hotel, all totaling Ksh. 1,285,100 for half-board accommodation and a full-day conference for the retreat held in Naivasha. The payments were made against a pro forma invoice, contrary to Section 146 of the Public Procurement and Asset Disposal Act, 2015.

Further examination of payment vouchers revealed that an amount of Ksh. 3,332,759 was paid to members of staff of the hospital while on official duties within the country, as quarter per diem, yet full board accommodation had been provided.

A review of the payroll and personnel data revealed that the hospital had employed a total of 3,632 employees, out of whom 2,551 or 70% of the total staff were from the same community, contrary to Sections 7(1) and (2) of the National Cohesion and Integration Act, 2008.

The hospital’s board had incurred expenses amounting to Ksh. 10,846,184. A review of the records revealed that during the year 2022-2023, there were two board retreats, one in Embu and another in Naivasha. However, approval from the Cabinet Secretary for holding the board retreat away from the principal or registered place of business of the hospital is not there.